BUDAPEST -- Hungarian car parts and agricultural machinery firm Mezogep said on Wednesday it turned to profit in the first quarter from a loss a year ago, driven by a sharp sales rise and a fall in operating costs.
Mezogep, controlled by Canadian firm Linamar Corp., said it posted a net profit of 109 million forints ($513,500) in January-March against a net loss of 21.2 million forints in the same period of 2002.
Sales rose by 42.5 percent year-on-year to 4.93 billion forints, while its operating costs fell by nearly 10 percent to 376.4 million forints.
The company said it reamined confident that it would be able to maintain a sales growth, while new car industrial projects would help improve profitability.
"Mezogep's management believes that it will be able to continue to boost sales significantly thanks to new contracts," the company said in its earnings report. "The company secured new businesses worth 3.9 billion forints during the quarter.
"Mezogep's mangement thinks that with a continuous coming to fruition of car industrial projects the profitability of the company is improving significantly," it said.
Mezogep, which generates 73.3 percent of its revenues from car parts manufacturing and the rest from agricultural machinery, said revenues in the two divisions rose by 46.2 percent and 33.3 percent, respectively.